| SACRAMENTO, Calif., June 13
SACRAMENTO, Calif., June 13 California will
spend $250 million on a controversial high speed rail project,
fund pre-school for low-income children, and pay down debts
under a budget deal that is likely to be approved this weekend,
lawmakers said on Friday.
The proposal, approved by a conference committee but still
subject to negotiation before a budget deadline on Sunday, marks
a compromise with Democratic Governor Jerry Brown, who has
demanded fiscal restraint from progressive Democrats who wanted
to restore recession-era cuts.
"The overall architecture of the governor's proposal remains
intact," said Brown spokesman H.D. Palmer. "Over two fiscal
years, we're going to pay down $2 billion in debt and make the
first deposit into the rainy day fund in seven years."
California faces the upcoming fiscal year, which begins July
1, in good financial shape, thanks to new taxes approved by
voters and the resurgent economy. When Brown took over in 2011
after serving two terms from 1975 to 1983, the state faced an
18-month budget gap of $25 billion.
Widely credited with restoring the state to sound financial
footing, Brown held lawmakers to conservative estimates of the
state's future income, insisting on enshrining a rainy-day fund
in the state constitution and paying down a so-called "wall of
debt" built up over years of deficit spending.
Barring last-minute arm-twisting on Friday, the budget
scheduled to be passed by lawmakers on Sunday will encompass
Brown's initial plan for $76 billion in education spending,
along with additional programs negotiated by lawmakers.
Brown's controversial high speed rail project, a $68 billion
effort opposed by Republicans, will receive $250 million in
funding from the proceeds of the state's cap and trade program,
under which the state collects a fee after polluters buy and
sell their rights to emit carbon into the air.
As part of a compromise with Brown, lawmakers negotiated
additional commitments for cap and trade funds, including money
for affordable housing, mass transit and clean energy projects.
"This budget proves once again that negotiation and
cooperation can achieve a great outcome," said Democratic Senate
leader Darrell Steinberg, of Sacramento, who was involved in
several of the compromises.
His priority, an expansion of public pre-kindergarten for
four-year-olds, was passed in a scaled-back form by the
conference committee on Thursday and is expected to remain in
the budget despite initial opposition from Brown.
(Reporting by Sharon Bernstein; Editing by Richard Chang)